Bank of Queensland's Stuart Grimshaw to become executive chairman of pawnshop operator EZCorp

Shaun Drummond

NASDAQ-listed pay day lender and pawn shop operator EZCorp has confirmed Bank of Queensland chief executive Stuart Grimshaw will become its executive chairman in an Australian-led takeover of the troubled company's leadership.

An adviser to the company, fellow Australian Lachlan Given, was appointed non-executive chairman last month. But he will now become executive vice-chairman in a coup led by EZCorp's controlling shareholder, MS Pawn Ltd.

EZCorp's CFO, Mark Kuchenrither, has acted as its chief executive since last month but was confirmed as its new president and CEO on Wednesday.

In a shock move, Bank of Queensland announced Mr Grimshaw would be leaving on August 31 to take up the new role in Austin, Texas.

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After a 2 per cent fall on Wednesday, the bank's share price fell another 4.2 per cent to a low of $11.47, before rallying to about $11.77.

EZCorp owns 32 per cent of ASX-listed Cash Converters International and Mr Love and Mr Beal represent EZCorp on the board of the Australian company.

Cash Converters CEO Peter Cummins is another Australian who has joined the board of EZCorp to fill one of the vacancies.

He said Cash Converters would announce replacements on its board from EZCorp for Mr Love and Mr Beal at its 2014 annual results on August 22.

After the board moves at EZCorp, California law firm the Wagner Firm independently began investigating "possible breaches of fiduciary duties" by the company's directors. Lawyer Avi Wagner said he was examining payments of about $US600,000 ($644,804) a month to "related entities" by the company "which didn’t appear to be supported".

"The question is did the directors behave appropriately," he said.

Since February, EZCorp has also been under investigation by the as part of a wider investigation into pay day lenders.

According to EZCorp's March quarterly report to the SEC, it is to "determine whether pay day lenders have engaged in or are engaging in unlawful acts and practices in connection with the advertising, marketing, offering, provision, servicing or collection of loans in violation of US federal consumer financial protection laws".

Investors and analysts are still puzzling over why Mr Grimshaw would leave a job heading a $4.4 billion company commanding $2 million pay to lead a $US500 million company. It appears, however, that Mr Grimshaw stands to gain at least a $1 million above that in short-term bonuses after he leaves BoQ.

EZCorp said Mr Grimshaw would be responsible for "global strategy, leadership and overall performance of the company".

In the statement, he said: "This is a business with enormous opportunity globally. With the right strategy, talent and focus, I believe it's a business capable of delivering superior long-term growth and shareholder returns."

In March this year, Cash Converters International launched Cash Converters in South America and Mexico under a joint venture in which it owns 20 per cent and EZCorp 80 per cent.